FTX — What I Think
I was building in crypto while FTX was ascending, so this one isn’t abstract to me.
FTX is the most painful cautionary tale on this list, because unlike a pure scam it wore the costume of the good guys almost perfectly. The vision it sold was the one a lot of us wanted to be true: a crypto exchange that was finally clean, finally professional, finally the adult in a room full of degenerates. Compliance-forward. Effective-altruist. The exchange your skeptical relative could maybe trust. And that costume is exactly what made the collapse so corrosive. It didn’t just take customer money, it took the argument that crypto could grow up.
The legitimate part was real. The product was genuinely good — fast, well-designed, a strong derivatives engine, pulling serious institutional and retail flow at a time when most exchanges felt held together with tape. There was a real exchange in there, the same way there was a real payments company inside Wirecard. That’s what makes these tragedies and not just crimes.
But it collapsed because, as established in court, customer funds were not where they were supposed to be. In November 2022 FTX imploded in a matter of days, and the now-adjudicated facts are that customer deposits had been funnelled to the affiliated trading firm, Alameda Research, and used as if they belonged to the house. Sam Bankman-Fried, the founder and CEO, was convicted in 2023 on multiple counts including fraud and sentenced to a long prison term. I’m stating the record, not embellishing it.
The vision that curdled: FTX believed being the smartest person in the room was a substitute for the boring infrastructure of trust. No real segregation between the exchange holding customer assets and the trading firm betting them. No board, no controls, no adult separation of the money that belongs to customers from the money the firm gambles. The whole thing ran on the premise that brilliance and good intentions made guardrails unnecessary. That is the exact inverse of what a custodian is. A custodian’s entire job is to make it structurally impossible to do what FTX did.
The lesson, for crypto specifically: “not your keys, not your coins” stopped being a slogan and became the whole point. On-chain settlement and proof-of-reserves matter because they replace “trust the smart, well-meaning founder” with “verify the ledger.” FTX is the strongest argument crypto ever made for its own founding principle. By violating it completely.
Favorite & worst CEO
The defining and only figure that matters here is the founder-CEO, Sam Bankman-Fried, since convicted of fraud and conspiracy in US federal court. I won’t construct a “favourite era,” because the public record doesn’t support admiring the leadership of a company whose central failing was that customer money wasn’t where customers were told it was. If there’s a figure to respect in the wreckage, it’s the on-chain ethos FTX betrayed — the people who kept saying self-custody and verifiable reserves were the point, who sounded paranoid right up until they sounded prophetic. In a story about vision, the most durable idea is the one FTX was built to make obsolete and instead proved essential.
Part of “What I Think About the Top 50 Fintech Companies of All Time.” I’m Prajjwal Chittori. prajjwalchittori.com.